Final rule today on parity – but devil is in the details

Today, more than five years after the Mental Health Parity and Addiction Equity Act (MHPAEA) was enacted, the federal government is issuing a final rule. Under the law, many insurance companies have already changed some of their onerous on-paper limitations in the policies, no longer saying that mental health and addiction benefits are subject to separate day and dollar limits from medical and surgical conditions.

The interim final rule issued in February of 2010 went farther, however, saying that such limitations also applied to “non-quantitative” issues such as medical review – when an insurance company decides whether or not a patient should get a certain kind of treatment, such as residential, or should get a certain number of visits a week. The insurance industry claimed it was blindsided by this interim final rule, and the federal government failed to provide guidance on exactly how the rule should be followed. Certainly, there was no enforcement of the interim final rule’s non-quantitative treatment limitation (NQTL) provisions.

Implementation and enforcement are the next steps. “The parity law protects patients for the express purpose of providing equal access to non-discriminatory mental health and addiction treatment as intended by Congress,” said American Psychiatric Association president Jeffrey Lieberman, M.D., on November 7. Without a final rule all these years, the parity law has been “ineffective and unenforceable,” he said.

Noting that insurance companies manipulated the language of the interim final rule, and some simply evaded the law itself, the American Psychiatric Association and other advocates say that the need to protect and fight for the rights of people with mental illness has never been greater.

A class action lawsuit brought by the New York State Psychiatric Association against United Healthcare and United Behavioral Health was dismissed this week by the U.S. District Court for the Southern District of New York. The court said that organizations like the New York State Psychiatric Association cannot represent the interests of patients or its member psychiatrists in health care discrimination lawsuits, and that the employers, in employer-sponsored plans, would be responsible for insurance companies’ violation of the law.

The American Psychiatric Association is also suing Anthem Health Plans and Wellpoint in the U.S. District Court for the District of Connecticut, charging that patients have been discriminated against by limiting access to quality care.

One of the most onerous ways insurance companies discriminate is requiring “fail-first” treatment. Some providers, like Optum, have removed it from their policies, but others haven’t. Requiring someone with mental illness or addiction to “fail” in outpatient treatment, for example, before authorizing inpatient treatment, can have tragic results.

Timeline

The Paul Wellstone & Pete Domenici Mental Health Parity & Addiction Equity Act (MHPAEA) was signed into law on October 3, 2008. It was added on to the Troubled Asset Relief Program (TARP) bank bailout bill, which is how it finally was passed into law.

The interim final rule implementing the law was published in February of 2010 and went into effect for all plans on January 1, 2011.

On April 1, 2010, Magellan, ValueOptions, and Beacon, three behavioral health carveouts, sued the federal government, saying the interim final rule went beyond the law.

In May of 2010, Congress wrote to the administration requesting further guidance on the MHPAEA, saying that the way the law was being implemented was not following Congressional intent, citing in particular denials of residential treatment by insurance companies.

In June 2010, a federal judge dismissed the lawsuit by the insurance carveouts against the interim final rule, allowing the rule to go ahead.

Between June 2010 and today, mental health and addiction treatment providers continued to experience violations of the law and the interim final rule, in particular a disregard for the NQTLs, with insurance companies pursuing even concurrent review of treatment, deciding what patients could and could not have as benefits.

On November 8, 2013, a final rule was issued.

Stay tuned for a report later today following the administration’s press conference and release of the final rule.